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Moving to a new home is an exciting journey, brimming with possibilities
and hope, especially for families. When you embark on this adventure, the
well-being and happiness of your children and pets are paramount. This
comprehensive guide delves into prioritizing amenities for children and
pets when moving homes, ensuring your new abode is a nurturing and joyful
environment for the entire family.

Thinking about selling your house? If you are, you might be weighing
factors like today’s mortgage rates and your own changing needs to figure
out your next move.

Have you heard the term “Silver Tsunami” getting tossed around recently? If
so, here’s what you really need to know. That phrase refers to the idea
that a lot of baby boomers are going to move or downsize all at once. And
the fear is that a sudden influx of homes for sale would have a big impact
on housing. That’s because it would create a whole lot more competition for
smaller homes and would throw off the balance of supply and demand, which
ultimately would impact home prices.

Buying a home is exciting, especially if this is your first time. However, knowing how much house you can realistically afford before dreaming of a new place is crucial. You might only consider the price tag, but a home purchase involves more than that. Understanding the various costs helps you make the right decision and ensures your property becomes a wise investment. Understanding Home AffordabilityUnderstanding home affordability is your first step in the quest to find a home. This involves more than asking yourself if you can pay the mortgage — you must also look at your financials. This way, you can enjoy your new home without stretching your budget too thin.What Does Home Affordability Mean?Home affordability is about balancing your dream home’s cost with your financial health. It ensures your monthly house payments are manageable based on income and debts. This helps you maintain a comfortable lifestyle while enjoying your new place.Income vs. DebtThe relationship between your income and debt is key in determining what you can afford. Lenders evaluate this through your debt-to-income (DTI) ratio, a percentage of your gross monthly income used to pay off debts. A healthy number signifies to lenders that you can manage a mortgage comfortably on top of your obligations.The 28/36 Rule and New RecommendationsThe 28/36 rule is a traditional rule of thumb for assessing affordability. This guideline suggests that up to 28% of your gross monthly income should be dedicated to housing expenses and no more than 36% to total debt service.However, a recent report from ATTOM highlights a more conservative approach, especially for average wage earners looking at median-priced single-family homes. Because house prices are rising, ATTOM recommends a maximum DTI of 28%, assuming a 20% down payment. Prices and wages can differ greatly from one area to another in Florida, so adhering to this guideline ensures homeownership does not cause financial strain.Key Factors Influencing Home AffordabilitySeveral key factors influence how much house you can afford:Home price: The starting point in your home affordability calculation is the price of the residence. While the median listing price for a house in the U.S. is around $300,000, remember that the market can vary greatly in different areas.Interest rates: Your mortgage interest rate will impact your monthly payments and the total amount you’ll pay over the life of the loan. Lower rates make homes more affordable by reducing the cost of borrowing.Realtor costs: Buying or selling a home usually involves Realtor fees, which are typically a percentage of the home’s sale price. These costs can affect the total amount you’ll spend in the homebuying process.Home inspection and closing: A home inspection is essential before finalizing your purchase to identify any issues with the property. Closing costs also add to your total expenditure, including loan origination fees, title insurance and more. It’s particularly important in Florida to consider the costs of hurricane damage and flooding inspections.Property taxes and home insurance: Property taxes vary by location and can affect monthly housing costs. Home insurance is also a must and can add to monthly expenses.Wages and credit score: Your income and credit score are critical in determining how much you can borrow and at what interest rate. Higher wages and a better credit score can lead to more favorable loan terms, making your house more affordable.How to Calculate How Much House You Can AffordMake it easy to calculate how much house you can afford by following a few simple steps:1. Do a Quick CalculationYou can quickly calculate how much house you can afford using the 28/36 rule. To get a rough estimate, calculate your monthly income by adding up your annual income before taxes and dividing by 12. Then, apply the 28% rule by multiplying your monthly income by 0.28.This figure gives you an expectation of the monthly mortgage payment you can afford. For example, say you make $5,000 per month. Multiply $5,000 by 0.28 and you get $1,400. With this monthly budget for your mortgage, you can consider the total loan amount to which this monthly payment may correspond.2. Check Your Credit ScoreAfter you’ve estimated what you can afford, the next step is to check if your credit score is good enough to qualify for a mortgage loan. A higher number indicates to lenders that you’re a lower-risk borrower, which can lead to more favorable loan conditions. The magic number is 740 or above for receiving the lowest interest rates. While securing a mortgage with a lower score is possible, you may face higher interest rates, resulting in more expensive monthly payments.Check your credit score by getting a free report each year from major credit reporting agencies like Experian, Equifax and TransUnion. You can review these reports at Annual Credit Report.com for a comprehensive look at your history and score.3. Gather Your Financial InformationIt’s important to have all your financial information at hand before approaching mortgage lenders. This includes your monthly household income, details of existing debts, and an overview of your savings and investments. Having a clear understanding of your finances streamlines the mortgage application process while accurately determining how much you can afford to pay.4. Determine Your Debt-to-Income RatioAfter gathering your financial details, determine your DTI. Lenders use this metric to evaluate your ability to manage monthly payments and repay debts. Maintaining a DTI ratio within acceptable limits is essential for securing a mortgage that aligns with your financial goals and capabilities.5. Calculate Your Home AffordabilityOnce you have a clear picture of your financial situation, you can calculate how much house you can afford. This step involves synthesizing the information you’ve gathered so far. The goal is to pinpoint your price range while keeping your finances in check.To calculate your home affordability, consider factors such as a 3%-20% down payment, interest rate, loan term, taxes and insurance. Using online mortgage calculators can simplify this process. Inputting your financial details can give you a detailed estimate of how much house you can afford. Tools like these consider current interest rates, your down payment and other critical variables to provide a picture of total affordability.Setting the Stage for Homeownership SuccessAs you look forward to finding your dream house, remember that preparation is key. Carefully assessing your finances and understanding the full scope of home affordability will set you up for a stress-free homebuying experience. With the right tools and knowledge, you’ll be ready to make informed decisions that align with your financial well-being and homeownership goals.

Mortgage rates have hit their lowest point in over a year and a half. And
that’s big news if you’ve been sitting on the homebuying sidelines waiting
for this moment.